Marketplaces are not just a sales platform, but an opportunities for retailers to increase brand awareness, soft-launch into new territories and access valuable data.
The Dune Group currently trades across six countries on Amazon, eBay, La Redoute and Zalando, and speaking at RBTE 2016, marketplace manager, Lorna Beament, said the retailer uses marketplaces differently depending on the country and the platform. For example, Dune uses eBay in Australia for cross-seasonal trade and is also live on La Redoute in France as a brand awareness exercise.
Joining Beament on a panel at the RBTE show this week, Neil Tunbridge, board member of Think Tank, Iorma, said brands can use marketplaces to test the waters by launching digital-first in new territories.
Tunbridge noted that retailers need to be aware of the trading nuances in different countries, such as the 200,000-plus tax codes to consider in the US or the Middle East, where 70% of orders are cash on delivery.
A retailer can also data gathered from marketplace launches, such as conversion rates, to make a more informed decision before launching a dedicated website or physical store in the new country.
In fact, Beament said Dune has a standalone website in France but consumers are still unaware of the brand. She said Dune also uses marketplaces to understand customers fashion likes and dislikes so it can tailor the brand website according to taste.
Tunbridge agreed: “La Redoute awareness is around 90% in France, so yes, it is about revenue and getting new season product out to new territory, but also it’s about building the brand in right way, and you couldn’t do that by opening a store in Paris.”
But Beament said if the UK was to leave the EU after the referendum in June, she could be out of a job. “My job role will change quite considerably,” she said.
Dune is using a US vendor, ChannelAdvisor, which takes the retailer’s inventory and product data and transports it into the marketplace platform. The vendor also takes product information for marketing on platforms like Pinterest and Google.
Beament said the main challenge is ensuring the chosen marketplace’s fulfilment method is robust. “When I do future integrations those are the questions I immediately ask because those were the pinch points,” she explained.
Beament, who held similar roles in Boohoo.com and Mothercase, also said the retailer had to make a lot of changes to accommodate returns policies on certain marketplaces, which made Dune realise its internal return service was not up to scratch, so it was improve in-line with marketplace expectations.
She also described how one of the biggest hurdles when setting up marketplaces is internally from the finance department. “They give you the biggest push back,” she said, noting how finance is concerned about the new channel and how the company invoices, when will it physically get hold of revenue and how. “IT you get a bit of a push until the first systems are in place, but finance is the hardest ones to get around, definitely.”